With the release of Office 365, the Microsoft hosting community has been asking “What’s in it for us?” At a glance, I would agree, especially when it comes to Office. Office can be installed on up to 5 devices with Office 365, under SPLA, you have to install it on a server and have remote access into the server. This would require not only Office, but RDS and Windows Server! Microsoft did recently (January, 2014) announce RDS mobility rights. More details found here. I also wrote why Office needs to have mobility rights or else the entire “Office 365” type experience (from a licensing perspective) won’t work. Check it out here
If I was in the hosting business, I would not try to compete against Office 365 from a licensing perspective; I would embrace it. The most successful service providers offer Office 365 as part of their solution. For example, if you host SharePoint, like it or not the end customer is going to look at Office 365. They will want to compare your solution to Microsoft’s. What differentiates your offering to Microsoft’s? There’s the obvious – you are regional or local, you can offer customization, you can also offer dedicated or multitenant environments; but more importantly you can offer services. Customers want to move to the cloud, the question is “how do they get there?” This is what you do. This is what you are great at. This is where you can increase your margins. Back to my SharePoint example, if you say to your customer – “here’s Microsoft’s SharePoint and here’s ours. We will help you facilitate to Office 365 if you choose (become the partner of record) but here is what you will be missing.” You are promoting your brand and not shunning Microsoft’s. I like what FP Web is doing. They are the SharePoint experts and are wiling to compare their solution to Microsoft’s on their website. Check it out for yourself http://www.fpweb.net/why-us/compare-o365-fpweb/
From a SPLA licensing perspective, the only bundled SKU is the productivity suite. This includes Lync Enterprise, SharePoint Standard, and Exchange Standard. It does not include Windows, SQL, or Office. Windows processor licenses allows unlimited number of users to access, the more users, the less expensive it is. Eventually all you will be quoting is the Exchange license. (if you are an Exchange only provider) That is how large service providers are able to hold down their costs.
Other option to Office 365 is to offer License Mobility. License Mobility allows your end customers to purchase licenses (with Software Assurance) and bring it into your environment. The advantage for the customer is volume discounts, and the advantage for the service provider is the ability to offer this in a multitenant hardware infrastructure. The virtual instance has to be dedicated, but the hardware it resides on can be multitenant. This is only if the customer has Software Assurance and the service provider signs the license mobility addendum. Windows is not included and would have to be reported under SPLA. I will write another blog on license mobility. Stay tuned.
Thanks for reading,